Williams: Financial and Managerial Accounting Chapter 3 SmartBook

Which of the following is considered the first step of the accounting cycle?

Accounting records are often used to obtain detailed information pertaining to a particular ___.
 

The record used to keep track of the increases and decreases in financial statement items is termed a(n) ___ account.
 

Each account has a __ (Select all that apply).

A company purchased land for $50,000 by paying $20,000 cash, and by issuing a note payable for the remainder of the amount owed. It recorded this transaction by _____ land for $50,000, _______ cash for $20,000, and _______ notes payable for _______.

Which of the following is not considered a specific step of the accounting cycle?

If debit entries to an account exceed the total of credit entries to an account, that account has a ___ balance.
 

Accounting records help to establish ___ 

 for business assets and transactions.
 

An account is maintained for

An owners' equity account is increased via a ___ entry.
 

The form of an accounting account resembles which letter?

A company purchased a $30,000 piece of equipment by paying $10,000 cash and issuing a note payable for the unpaid balance. This transaction required a: (Select all that apply).

The cash settlement (payment) of a $40,000 account payable results in:

The balance in Johnston, Inc.'s, Cash account on July 1 is $82,000. During July, the following debit entries were posted to the Cash account: 7-7, $10,000; 7-14, $12,000; 7-21, $16,000; and 7-31, $22,000. The following credit entries were posted to the Cash account: 7-7, $14,000; 7-14, $19,000; 7-21, $17,000; and 7-31, $32,000. Johnston, Inc.'s, Cash account balance at July 31 is ___. 
 

In every transaction that is recorded,

Accounting records are often used to obtain detailed information pertaining to a particular ___. 
 

True or false: A business that reports profits will always have sufficient cash.
True False

All asset accounts normally have ___ balances.
 

The right side of an account is called the

To record the cash purchase of buildings requires a debit entry to______________and a credit entry to_____________.

The need for debit entries and credit entries, equal in dollar amount, to be recorded for every transaction is referred to as______________-_______________accounting.

Changes in owners' equity resulting from the profitable or unprofitable operation of the business are recorded in which account?

An owners' equity account is decreased via a ___ entry.
 

Transactions are initially recorded in a

Posting simply means updating the ___ 

 accounts for the effects of the transactions recorded in the journal.
 

In which order are accounts in the ledger are generally listed?

Dividends have the effect of __ (Select all that apply)

When a company's expenses exceed its revenue, its income statement will report

The source of the amounts needed to prepare financial statements is a

Posting entries to the ledger involves

In an accounting system, ledger accounts generally appear in the following order: ___  accounts first, ___  accounts second, and owners' ___ 

 accounts third.
 
 
 

The 12-month accounting period used by an entity is called its

Earnings are generally retained in a business to

Which financial statement elements (components) are reported in the income statement?

The journal is a ___ 

 record of business transactions.
 

What effect does earning revenue have on the accounting equation?

The period of time covered by an income statement is termed the company's ___ period.
 

Revenue is recognized when a business has completed the ___ process.
 

When a dividend is declared, the balance in which account is reduced?

If payment occurs at the time the expense is incurred, then

Net income is equal to ___ minus ___. 
 

Dividends reduce owners' equity; therefore, they are recorded with ___ entries.
 

Transactions recorded in a journal are periodically posted to a

The sales force of Woidtke, Inc., generated $200,000 of orders in June. These orders were shipped in July, and payment from the customer was received in August. Sales commissions related to these orders and sales were paid in September. In which month should sales commission expense be recognized?

As a company generates revenue, which asset accounts are most likely to increase? (Select all that apply).

True or false: Revenue is recognized when it has been earned, regardless of when cash is received from customers.
True False

If a company bought a $60,000 piece of equipment on July 1, and the useful life of the equipment is 5 years, the equipment's depreciation expense for the month of August is ___.
 

Which of the following are examples of typical expenses? (Select all that apply).

When the future benefits of certain expenditures, such as employee training costs, are not possible to determine or measure, accountants often rely upon __ (Select all that apply).

Which of the following statements regarding dividends are true? (Select all that apply).

In determining net income, we offset the current period's expenses against the current period's ___ . 
 

Which of the following expenditures is likely to benefit more than one accounting period?

The purpose of accrual accounting is to most accurately measure

When the future benefits of certain expenditures, such as employee training costs, are not possible to determine or measure, financial accountants often rely upon

A company made an error by recording too much revenue. To correct this error, the Revenue account should be ___ 

 (debited or credited).
 

If employee wages for a month are paid immediately in cash, which account is debited?

General journal entries are recorded

By offsetting revenue with resources consumed in generating that revenue, the matching principle provides the best measure of

Expenses decrease ___-___; therefore, expenses are recorded with ___ 

 (debit/credit) entries.
 
 

True or false: Dividends are an expense; therefore, they are recorded with debits.
True False

The equality of debits and credits in the general ledger is proved by preparing

If advertising services are purchased with the bill to be paid in 45 days, which account is credited?

Journal entries recorded in the general journal include (Select all that apply).

Under the accrual basis of accounting, __ (Select all that apply).

A trial balance can be out of balance for which of the following reasons? (Select all that apply).

The sum of all debits in the general ledger must equal the sum of all 
 

If a consultant provides consulting services in June, but the bill is not due from the client until July, the account debited by the consultant in June to record the transaction is

In most businesses, the accounting cycle is performed using

True or false: When the debit and credit columns of a trial balance are equal in amount, all transactions have been analyzed and recorded correctly throughout the period.
True False

Aspects of accounting that are more analytical than the accounting cycle include: (Select all that apply).